Is Fidelity Select Software & IT Services (FSCSX) a Strong Mutual Fund Pick Right Now?

If you've been stuck searching for Sector - Tech funds, consider Fidelity Select Software & IT Services (FSCSX) as a possibility. FSCSX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.ObjectiveWe note that FSCSX is a Sector - Tech option, and this area is loaded with many options. Found in a wide number of industries such as semiconductors, software, internet, and networking, tech companies are everywhere. Thus, Sector - Tech mutual funds that invest in technology let investors own a stake in a notoriously volatile sector, but with a much more diversified approach.History of Fund/ManagerFSCSX is a part of the Fidelity family of funds, a company based out of Boston, MA. Fidelity Select Software & IT Services debuted in July of 1985. Since then, FSCSX has accumulated assets of about $9.41 billion, according to the most recently available information. The fund is currently managed by Ali Khan who has been in charge of the fund since July of 2014.PerformanceInvestors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 7.82%, and it sits in the bottom third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 20.26%, which places it in the bottom third during this time-frame.It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. The standard deviation of FSCSX over the past three years is 19.61% compared to the category average of 21.21%. The fund's standard deviation over the past 5 years is 19.89% compared to the category average of 23.2%. This makes the fund less volatile than its peers over the past half-decade.Risk FactorsWith a 5-year beta of 1.13, the fund is likely to be more volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. The fund has produced a negative alpha over the past 5 years of -6.51, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.ExpensesFor investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, FSCSX is a no load fund and it has an expense ratio of 0.62%.This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.Bottom LineThis puts this fund from Fidelity in the top 40% of all mutual funds we have a rank on right now. As a result, this is likely an excellent choice for investors seeking an option in the Sector - Tech category.Your research on the Sector - Tech segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. 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Today, you have a rare chance to position your portfolio at the forefront of this opportunity.See Top Quantum Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Get Your Free (FSCSX): Fund Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks